TURKEY: NO GREEN ENERGY INVESTMENTS IN STIMULUS

UNCLAS ANKARA 000493 SIPDIS DEPT FOR OES/EGC BARBARA DEROSA-JOYNT AND ED FENDLEY E.O. 12958: N/A TAGS: EFIN ENRG SENV KGHG TU SUBJECT: TURKEY: NO GREEN ENERGY INVESTMENTS IN STIMULUS PACKAGE REF: A. STATE 26022 ¶B. ANKARA 118 ¶C. ANKARA 297 ¶D. ANKARA 313 ¶1. Although Turkey has now passed two major stimulus packages (see reftels),neither set of legislation contained any major initiatives on green investment. The upcoming third package is expected to focus on credit guarantees, and there has not yet been any discussion of a fourth package. ¶2. The GOT did grant an amnesty on taxes and fines for people who trade-in vehicles older than 30 years for a new car, partially with the intent of removing high-emission vehicles from the road, but more as a means to spur new car purchases. The success of this plan has been limited, for reasons outlined in Ref C. More successful has been the temporary removal of the special consumption tax on new vehicles (Ref D),which has sparked a sharp uptick in new vehicle sales and will tangentially help replace older vehicles with newer, low-emission models. Again, the goal was less to help the environment than to spur the automotive industry, and if there is a net gain in overall cars on the road the emissions picture may actually worsen. ¶3. Prior to the passage of the stimulus package, there had been some expectation that there would be tax incentives for automotive firms researching clean technologies and retail tax incentives for consumers purchasing green vehicles, but neither proposal was included in the final plan. Visit Ankara's Classified Web Site at http://www.intelink.sgov.gov/wiki/Portal:Turk ey Jeffrey